Know your production costs
The ongoing theme of this winter has been to know your costs of production and break-evens. Corn Soy Expo 2017 echoed the statement that knowing your costs of production is “powerful” when meeting with your lending institution, as most do not have this. Knowing your production costs and break-even cost per bushel helps you immensely with marketing your crop as well as working with a budget on your crop inputs. It is essential to operating a sustainable business. Working through your costs will show you areas that you can improve on and helps make difficult decisions easier to decide on. Going into the growing season with a plan helps you pull the trigger on opportunities that present themselves much quicker avoiding the emotion tied to them.
Here are a few tips to determine your cost of production:
- Know your true equipment and maintenance costs
- Be honest and realistic with your numbers, real numbers are what you are looking for
- Don’t forget to include labor costs
- Work with a farm advisor who knows your operation and can help with improvements based on the information you put in and numbers that come out
Knowing your cost of production allows you to operate a sustainable business and helps you improve your business to succeed in any economic environment. The Landmark Services Cooperative team has the tools to help you with creating a crop plan and calculating your break-even to make your operation profitable.